Gold boosted by uncertainty in Ukraine

Gold is up 0.7% as traders take their cash out of stocks and invest in safe-haven assets like gold.

Gold is trading at $1328, as the developments in Ukraine have encouraged traders to move their cash out of stocks and into the yellow metal. We are beginning to see a repeat of the Crimea crisis, with conflicts between Ukrainian forces and pro-Russian radicals in the East of Ukraine. Even though we are nowhere near an all-out war, the possibility of any exchange of fire will prompt traders to fly to quality.

As Alastair McCaig stated, the increase in political tension drove gold above the $1300 mark last week. The situation has deteriorated since then and that is why we are approaching the $1330 mark.

Tomorrow, Janet Yellen of the Federal Reserve will make a statement at 1.45pm (London time). If Ms Yellen reiterates her mildly dovish sentiment, we could see gold head towards $1334 mark.

Spot gold chart

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.